Government puts out list of 9,500 'high risk' finance companies

After the announcement of notes ban in November 2016, many NBFCs and rural and urban cooperative banks had come under the scanner of I-T department and ED.

Representative image&nbsp | &nbspPhoto Credit:&nbspIndiatimes

New Delhi: The Financial Intelligence Unit (FIU), which works under the finance ministry has released a list of around 9,500 non-banking financial Companies (NBFCs) which have been categorised as ‘high risk financial institutions’. (Click here to see the complete list of companies)

The NBFCs categorised as 'high risk' by FIU-India were found to be non-compliant with Prevention of Money Laundering Act (PMLA) and PML rules like non registration of principal officer as on January 31, 2018.

After the announcement of notes ban in November 2016, many NBFCs and rural and urban cooperative banks had come under the scanner of I-T department and Enforcement Directorate (ED) for illegally converting banned Rs 500 and Rs 1,000 notes of people who had unaccounted income.

According to a report in the Times of India, these NBFCs and cooperative banks were found converting banned notes by receiving cash as deposits and issuing back-dated fixed deposits and cheques despite RBI preventing this.